- Bitcoin experienced increased inflows to exchanges, signaling heightened institutional and whale interest.
- Rising short positions contrasted with growing long-term holder accumulation.
Bitcoin [BTC] holders have been growing impatient as BTC fails to push past the $27,000 price range. Despite this, BTC inflows to exchanges remained high.
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Inflows spike
Recent data revealed a substantial influx of Bitcoin into Binance, suggesting intensified market activity. Notably, a divergence emerged in the past two months, with a marked contrast between large Bitcoin deposits exceeding $1 million and smaller withdrawals of $1 million or less.
This divergence hinted at increased interest from institutional or high-net-worth traders and investors. It signaled the potential for heightened market volatility, a factor that traders could seize upon in the coming days.
Source: glassnode
This surge in volatility correlated with a material rise in Bitcoin’s open interest, a critical metric reflecting the total value of outstanding futures contracts.
The increasing open interest implied a growing appetite for Bitcoin trading, further reinforcing the notion of impending market fluctuations.
Bears take the lead
Conversely, a growing number of traders anticipate a BTC price correction, indicated by the rising proportion of short positions in the market. Approximately 52% of positions were bearish, while long positions accounted for the remaining 48%.
Source: Coinglass
Optimism remains high
Addressing Bitcoin’s broader ecosystem, Glassnode’s data underscored a significant milestone – the number of addresses holding at least 1 BTC reached an all-time high of 1,022,655. This surge in unique addresses hinted at an increasing interest in Bitcoin ownership and usage.
Moreover, an intriguing trend emerged on the whale front, with a substantial quantity of Bitcoin being HODLed or classified as “lost.” The total reached a five-year peak at 7,886,511.641 BTC
? #Bitcoin $BTC Amount of HODLed or Lost Coins just reached a 5-year high of 7,886,511.641 BTC
View metric:https://t.co/dJK8rxBVD3 pic.twitter.com/SF7naJcz8s
— glassnode alerts (@glassnodealerts) September 23, 2023
State of holders
Examining Bitcoin’s MVRV (Market Value to Realized Value) ratio and the difference between long and short positions provided deeper insights.
The declining MVRV ratio implied that many Bitcoin holders were not in a profitable position. This suggested that these holders were less likely to sell, potentially reducing selling pressure on the market.
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Additionally, the falling long/short difference indicated a rise in short-term Bitcoin holders.
Short-term holders tend to be more responsive to market movements and are more inclined to sell upon any indication of profit. This trend signaled an increasing number of traders seeking to capitalize on short-term price fluctuations.
Source: Santiment
